WASHINGTON -- Treasury Secretary Timothy Geithner said Wednesday that President Barack Obama’s administration is “absolutely” willing to go off the so-called fiscal cliff if Republicans refuse to increase taxes on the nation’s top earners.

During an interview with CNBC, Geithner was asked if the White House was willing to dive off the cliff if Republicans don’t accept a deal that raises tax rates for those making more than $250,000.

“Oh, absolutely," he responded. "Again, there's no prospect in an agreement that doesn't involve the rates going up on the top 2 percent of the wealthiest."

Geithner’s comments offer the strongest indication that Obama would accept the automatic spending cuts and tax rate increases that kick in if an agreement is not reached before the Dec. 31 deadline.

“What we’re trying to do is put in place a comprehensive, balanced set of fiscal reforms that put us back on the path of living within our means and create room for investing to make the economy stronger, make sure we're protecting Medicare for future generations, and forcing the government to use the taxpayers' resources more wisely,” Geithner said, when pressed to explain why standing firm on tax rates increasing for the top 2 percent would be worth going over the cliff.

“In that context, you have to have a significant amount of revenues. We don't see a way of doing it that makes any sense or has any political viability without rates going up as part of that deal,” Geithner said. “Again, the size of the problem in some sense is so large it can't be solved without rates going up. I think there's a broad recognition of that reality now.”

Geithner has previously used similar language, most recently during an appearance on NBC's "Meet The Press."

"To-- to go over this fiscal cliff, and because Republicans won’t raise taxes, tax rates on the wealthiest two percent of Americans, would subject the average American to big tax increase and enormous damage from the other cuts that would happen in that context," Geithner said Sunday.

The treasury secretary, who has played the role of leading negotiator on behalf of the White House in fiscal cliff talks with Congress, also noted that businesses and investors are opening up to the idea of tax rates rising -- a shift reflected in comments made by several top executives earlier this week.

FedEx Chairman and CEO Fred Smith, an adviser to Sen. John McCain's 2008 presidential campaign, on Tuesday referred to the notion that tax hikes on the richest Americans would kill jobs as "mythology." And on Monday, a group of the nation's top defense executives took a surprising turn, endorsing tax rate increases on the wealthy.

“I think there's broad recognition that rates are going to go up as part of a deal,” Geithner said. “I think that's a welcome change.”

House Republican leaders presented a counteroffer to the White House on Monday, which included an extension of all Bush-era tax cuts, considerable changes to Medicare and large cuts to mandatory and discretionary spending. The White House immediately rejected the proposal as a GOP wishlist -- a sentiment Geithner continued to carry forward during his interview on Wednesday.

"We don't actually know what the Republicans think they can do in that context yet, because they haven't told us," he said of the proposal laid out by House Speaker John Boehner. "We don't know whose taxes would go up. We don't know the mixes of rates and limitations and deductions and loopholes that they would support."

The Budget Control Act, passed by Congress last year, would require the start of steep budget cuts in January. That, with the expiration of Bush-era tax cuts, is the fiscal cliff, which some economists have warned could tip the nation's economy back into recession.

This post was updated to reflect Geithner's earlier comments.

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  • Pete Peterson

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  • Bill Clinton

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  • Alan Greenspan

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  • George W. Bush

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  • Dick Cheney

    While Bush was busy cutting taxes, Cheney was busy planning the war on terror. For the first time in our history, we sent our military into battle without raising taxes at home to help pay for it. It added trillions to the debt. <a href="http://www.marketwatch.com/story/10-people-who-led-us-to-the-fiscal-cliff-2012-11-21?pagenumber=1">Read more at Market Watch.</a>

  • Grover Norquist

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  • David Lereah

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  • Barack Obama

    Obama may be the perfect representative of our age, because he encapsulates our national schizophrenia over the budget. He honors both the greed and the guilt. He presided over the largest deficits in history, including a large fiscal stimulus, bailouts of the auto industry, and an expansion of the safety net. But Obama also lectures us about the need for the government to tighten its belt, even during a recession. He wants to raise taxes, if only on a few, and he’s expressed willingness to cut into the great middle-class entitlements. It was Obama’s administration that first suggested the bargain in 2011 that created the fiscal cliff. <a href="http://www.marketwatch.com/story/10-people-who-led-us-to-the-fiscal-cliff-2012-11-21?pagenumber=1">Read more at Market Watch.</a>

  • John Boehner

    The House speaker is trapped in Grover Norquist’s world. He’s a pragmatic legislator who accepts that the government needs more revenue, but his caucus in the House doesn’t agree. In the summer of 2011, Boehner nearly forced the nation to default on its debt because he couldn’t deliver the votes necessary to raise taxes. In the end, Boehner was forced to punt the problem down the road. Today’s fiscal cliff showdown is the result of Boehner’s inability to lead the House Republicans to a deal. <a href="http://www.marketwatch.com/story/10-people-who-led-us-to-the-fiscal-cliff-2012-11-21?pagenumber=1">Read more at Market Watch.</a>